Quote:
Originally Posted by rowan
I'm also worried that Epass might be using a fractional reserve system, in other words, they do not actually have physical "possession" of the sum of their customer's balances... part of that gets tied up in outside investments. The system works (usually) because with enough customers there's an average minimum balance - anything above that (plus a safety margin) can be used for other investment purposes without affecting the company's ability to handle the usual daily deposit and withdrawal operations. Trouble is if those investments lose money then it could be the start of a downward spiral, where the sum of their available cash and unrealised investments is less than the sum of the customer's balances. In other words, they can't pay out everyone. A run on the bank (where a large number of customers withdraw all their money) could leave the remaining customers with cents in the dollar, or nothing.  |
Wouldn't that be illegal? First of all banks do lend out money, but there should always be enough to cover people who keep their money at the bank if everyone wanted to withdraw their money out of their accounts. In this case epassporte is not a bank, just a processor, so if someone sends you money (via them) they shouldn't be allowed to take your money and spend it, all off the funds should always be there available for you to send to someone else or to withdraw it. It's just a pass through not a bank. The only thing they should be able to get is the fees to do the pass through. The money should always be there.
Seems logical to me too, the money can't be on the card (physically). The card is just the method to TRANSFER the money. The card is visa's network that the money passes through. From you to a visa merchant or you to the atm, then to cash. If the VISA CARD is frozen then wouldn't the money still be in the bank. If the money is in the bank, then why can't it be moved to the wallet ? The card to wallet transfer is just electronic code, moving numbers from one account to another. Doesn't seem like visa can stop them from saying " Account 1 has $5,000 on the Visa card, since we can't use cards anymore we will put that "$5,000" on his wallet so he can still get it back via wire or do wallet to wallet transactions with out people. So the customer can't do atm or use it via visa card but I don't think anyone cares too much about that right now.
Correct me if I am wrong?
Either the bank froze all the money or Epassporte can do what I mentioned above? How could it be any other way??? someone educate me, i m not very knowledgeable with processing.
Ok I read that the money is already on the card... if it is on the card as in prepaid then why would the cards ever be suspended? the card holders did nothing wrong/ Why not just suspend the cards relationship with St Kitts or epassporte. If $1,000 is on the card then the card should able to be used until the $1000 is gone then throw them away.
Doesn't seem like all of the info is here. I guess time will tell.